Planning for a Loved One with Special Needs

The US Census Bureau has reported that one in five individuals suffer from an intellectual, physical or mental disability. While many government programs and benefits are available, it is often hard to maneuver through the sea of red tape to take advantage of them. By not planning for the future of your loved one, you could unknowingly miss out on valuable benefits or disrupt their lifestyle.

As advisors with a dedicated focus in special needs planning, we know this process can be overwhelming –  many clients are unsure where to even start. However, when you work with an advisor who concentrates in special needs, they can direct you to the best resources to develop a solid financial plan. Through our experience, knowledge and commitment, we help simplify this complicated journey. While every family and situation are unique, we want to share some of our top considerations for you as you help your loved one – now and in the future.

  1. When you care for a loved one with special needs, you don’t just have to plan for your financial future, you must also plan for theirs. Your money may have to outlast you for many decades. To ensure your loved one continues living a quality life, you must consider all aspects of their day-to-day living, including basic care, housing, domestic tasks, medical care and education. It is helpful to think about who will be involved in the care of your loved one. Besides parents, siblings, aunts, uncles and grandparents, your list may include a professional guardian, health care providers, legal and tax advisors, a government benefits coordinator and financial planner.
  2. Depending on the age of the individual, it is imperative a legal plan is in place. This statement may create a special needs trust and could designate a guardian. The guardian will most likely become the caretaker of your loved one should something happen to you. In situations where the individual has a less severe disability, a financial and healthcare power of attorney may be appropriate instead of a guardian. Please note, the trustee is the steward of the special needs trust, whereas the guardian has different responsibilities. In some cases, the guardian and trustee may be the same person, but not always.
  3. Drafting a letter of intent for caretakers is a priority. While this is not a legal document, it is important for whomever will be taking over caretaker responsibilities. It details all day-to-day aspects of your loved one’s life including doctors, therapists, medications, work schedules, meal schedules, clothing items, daily hygiene, allergies and what will help him or her live a joy filled life.
  4. From health care to housing allowances to job training, many federal, state and local resources are available for individuals with disabilities. But maneuvering through layers of bureaucracy is a daunting task. The rules are complicated and there is no centralized location for information. That’s why it’s important to work with a financial advisor that is trained in and focuses on special needs planning. Here are some points to be aware of:
  • One of the first hurdles in obtaining social security benefits is having your child’s disability diagnosed before the age of 22. If they are diagnosed after that age, your child may lose out on money from many government programs.
  • Caretakers are often unaware that Medicaid is a state – not federally – run agency. It’s important to know the individual rules in the state where your loved one resides.
  • If you have a child with special needs, they may receive Supplemental Security Income (SSI) to pay for essentials such as shelter, food and medical or dental care that is not covered by health insurance.  Once you as a parent claim your Social Security retirement benefit, your child may be able to change from SSI to Social Security Disability Income (SSDI). This will increase the dollar amount of government benefits your child will receive.
  • For those whose disability was diagnosed by the age of 26, an ABLE (Achieving a Better Life Experience) 529 account may be beneficial. This tax advantaged savings account can be used for housing, health care and other significant costs.

Planning for the future of an individual with an intellectual, physical or mental challenge adds another layer of difficulty onto an already complex task. Let us help you develop a strategy to ensure that your loved one can live their best life. For more information, visit our website or connect with us for a short meeting to see how we can help you.


Jenny Wiechel, CFP® Wealth Advisor

Michael Clayman, CFP®, ChSNC® Wealth Advisor

For informational and educational purposes only and should not be construed as specific investment, accounting, legal, or tax advice. Certain information is based upon third party data which may become outdated or otherwise superseded without notice.  Third party information is deemed to be reliable, but its accuracy and completeness cannot be guaranteed.  Individuals with special needs and those who take care of them have unique circumstances and individuals should talk with a qualified professional based on his or her own circumstances. Neither the Securities and Exchange Commission (SEC) nor any other federal or state agency have approved, determined the accuracy, or confirmed the adequacy of this article.  R-22-3391

The post Planning for a Loved One with Special Needs appeared first on Buckingham Strategic Partners.

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